China's textile and apparel exports reached $145.96 billion in the first half of 2026, up 1.4% year-on-year, according to data released by the General Administration of Customs on July 14. The headline figure suggests stability, but a closer look reveals a widening gap between upstream and downstream sectors.
Data Breakdown: Structural Shift Beneath the Surface
Textile exports hit $73 billion, up 3.5% year-on-year, with yarn exports surging 6.6% and fabric exports slipping only 0.5%. In contrast, apparel and clothing accessories exports totaled $72.96 billion, down 0.7%, though the decline narrowed by 0.9 percentage points from the same period last year.
June proved pivotal. Monthly exports reached $29.27 billion, up 7.2% year-on-year and 14.3% month-on-month. Textile exports alone grew 12.2% to $13.52 billion, while apparel exports rose 3.2% to $15.75 billion, with a 21% month-on-month surge. This signals that overseas buyers have begun stocking up for the autumn/winter season.
In RMB terms, cumulative exports for the first half fell 2.2% to 1.01222 trillion yuan, reflecting currency volatility. However, June exports in RMB also showed strong month-on-month and year-on-year growth, confirming real order support.
Market Divergence: US Shines, Traditional Markets Falter
The US market emerged as the biggest growth driver in the first five months, with export growth expanding by 15 percentage points compared to the same period last year. The stabilization of bilateral relations and the completion of inventory destocking by overseas brands have strengthened reliance on Chinese supply chains.
Conversely, demand from the EU, Japan, and South Korea weakened significantly. High energy costs and inflation in the EU continue to suppress consumer spending on apparel. Imports from China by ASEAN, Japan, and South Korea also declined, weighed down by regional tensions and rising energy prices. Temporary easing of tensions in the Middle East and lower shipping costs provided short-term support for June exports.
Industrial Logic: Why Upstream Holds Up
Overseas brands are now adopting low-inventory strategies, favoring frequent small-batch orders for yarns and fabrics over large long-term apparel orders. This shift has directly widened the performance gap between upstream and downstream sectors. China's complete industrial chain—from chemical fiber, spinning, and dyeing to finished products—offers delivery efficiency and product quality that are hard to replicate elsewhere. This makes upstream textiles a stable anchor even amid demand fluctuations.
In contrast, the apparel OEM sector faces low entry barriers, intense competition from international capacity diversion in Southeast Asia and South Asia, and price wars. This pressure on China's apparel exports is unlikely to ease in the near term.
Outlook: Challenges and Resilience
The World Bank warns that the global economy will continue to grapple with high energy prices, persistent inflation, and tightening monetary policies. Weak consumer demand in Europe and the US, rising production costs, and fragmented global trade patterns will test the industry.
Yet the June rebound has injected confidence. The era of low-cost, volume-driven exports is over. The keys to navigating the cycle are a complete industrial chain, product innovation, and diversified global market positioning. Despite external uncertainties, the industry's deep-rooted foundation in China provides solid support for stable trade performance in the second half of the year.